Disney to provide $3.8m in back pay to US staff

Two subsidiaries of entertainment organisation The Walt Disney Company are to provide a total of $3.8 million (£3.1 million) in back pay to 16,339 US employees following minimum wage and overtime violations.

The US Department of Labor has reached an agreement with the Disney Vacation Club Management Corporation and the Walt Disney Parks and Resorts US to back pay affected employees to ensure compliance with the Fair Labor Standards Act (FLSA).

The Wage and Hour Division at the US Department of Labor found that Disney resorts deducted a uniform or costume expense from staff, causing some employees’ hourly rates to fall below the federal minimum wage.

In addition, the resorts did not compensate employees who performed duties during a pre-shift period before the designated start of their shifts, or during a similar post-shift period. The resorts also failed to maintain required time and payroll records.

Daniel White, district director at the Wage and Hour Division in Jacksonville, said: “These violations are not uncommon and are found in other industries as well. Employers cannot make deductions that take [employees] below the minimum wage and must accurately track and pay for all the hours their employees work, including any time they work before or after their scheduled shifts.

“We hope the resolution of this case alerts other employers who may be paying employees in a similar manner, so that they too can correct their practices and operate in compliance with the law.

“The Disney resorts were very cooperative throughout the investigative process and worked with the division to ensure employees received the pay they earned.”